Employer Health Tax (EHT) Exemption Increase for 2020 –Tax Bulletin

Some good news for small businesses in Ontario.  Remember, every bit counts.

Please see the info below and check out the Ministry of Finance site below for full details.

Ontario Ministry of Finance

Employer Health Tax

Today the Ontario government announced it is increasing the Employer Health Tax (EHT) exemption for 2020 to $1 million to provide tax relief to businesses around the province so that they can focus on supporting the well‑being of their employees and their continued operations during this time of uncertainty caused by the coronavirus (COVID‑19) in Ontario.

Retroactive to January 1, 2020, the EHT exemption is increasing from $490,000 to $1 million for the 2020 tax year.  The EHT exemption will return to $490,000 on January 1, 2021.

Only the exemption amount is changing; eligibility for the tax exemption, tax rates and everything else remains the same.

Learn More

Read the Employer Health Tax Exemption Increase for 2020 – Tax Bulletin 

Need COVID 19 resources? Mainstay clients can access at no charge

Mainstay Insurance Brokerage Inc. is partnered with ConnectsUs HR ™ so you can take advantage of the proven HR package made for Canadian small business and compliant for Ontario, Alberta and BC.

There’s no cost to you – we’ve picked up the tab! You won’t even have to provide a credit card.

ConnectsUs HR ™ is adding COVID-19 resources (see below) over the next two days.  If you’re interested in accessing these and are already subscribed, please check out their site.  if you are not already subscribed, please call or e-mail us for the code to get the service for freeGET INFO HERE


Need Help? A few things for you and your employees.

I am reaching out to my clients in the coming days to check in.  I have spoken to many of you that have been dealing with lay-offs or immediate challenges, so I’m a bit behind in connecting with everyone and relying on this post to share info until we connect.

Please know that I am here and self isolated for the next week so if you need anything.  No more sailing trips for a while, so if you need help, just shout.


A few things to share today.

  1. The insurers are providing some relief options to employers around their benefit plans.  Some of these are short term relief (but maybe higher risk (no LTD) and longer term issues like higher renewals) but if you need help, please let us know and we’ll work with you to get the insurer or TPA to make things work.
  2.  Renewals may be delayed.  Our goal is to still deliver the info via e-mail, but the renewal rates may be deferred.  We’ll reach out to the affected clients one by one as the renewals come due.
  3. I saw this article (below) come in with links to services that may be of assistance to staff if you’ve had to make some tough decisions.

Stay safe and healthy.  Please follow the self isolation and social distancing.  We’ll get through this together.


Bridgewater, NS, Canada / CKBW  –  Ryan Everest  –  March 22, 2020 02:40 pm

The unfortunate reality of today is a lot of people are losing shifts, being laid off, etc because of COVID-19. If you require financial assistance at this time, you can find information below on ways the Federal Government is trying to help you through these tough times.

EMPLOYMENT INSURANCE: How To Apply For EI

EMERGENCY SUPPORT BENEFIT: Have You Been Laid Off Or Your Hours Reduced? Click Here

EMERGENCY INSURANCE SICKNESS BENEFIT: No Paid Sick Leave, Are You Quarantined, Sick? Click Here

EMERGENCY CARE BENEFITIf You’re Unable To Claim E-I But Are Sick Or Quarantined and/or Are Taking Care Of Family Members: Click Here

NEED MORTGAGE HELP? Mortgage Support For Canadians

CHILD CARE BENEFITS: Increased Child Care Benefit Information

TAX DEADLINE: Filing Deadline For Individuals Pushed Back Until June 1st

Summary of Current Primary Government Employee Support Programs

I just got a post from e2r that shared this info.  It helps to explain the programs that are now (or soon) available for support of businesses and their employees.


EMPLOYMENT INSURANCE – TEMPORARY LAYOFF
Employees are eligible for regular EI
Most typically a minimum of 700 insurable hours required
Employer to provide a ROE
1 week waiting period
55% of weekly earnings up to a maximum of $573 per week

EMPLOYMENT INSURANCE – TEMPORARY LAYOFF – EMPLOYER TOP UP
Employer top up payments are deducted from EI payments
If Employer has registered a Supplemental Unemployment Benefit Program (SUB) with Service Canada payments from the SUB plan are not deducted from EI benefits

EMPLOYMENT INSURANCE – REDUCED HOURS OF WORK COMBINED WITH EI BENEFITS
EI Work- Sharing Program – To avoid layoffs
Employees agree to reduced work schedule
Eligible employees receive EI benefits and continue to receive reduced employment income
Program can now be extended to 76 weeks

EMPLOYMENT INSURANCE SICKNESS BENEFIT – UNABLE TO WORK DUE TO QUARANTINE & ILLNESS WITH SUFFICIENT INSURABLE HOURS
No waiting period
A minimum of 600 insurable hours required
No medical certificate required
55% of weekly earnings up to a maximum of $573 per week

EMERGENCY CARE BENEFIT – UNABLE TO WORK DUE TO QUARANTINE & ILLNESS WITHOUT SUFFICIENT INSURABLE HOURS – EFFECTIVE APRIL 2020
Eligible employees receive up to 15 weeks of benefits, up to $900 bi-weekly
Application via Canada Revenue Agency
No medical

EMERGENCY CARE BENEFIT – UNABLE TO WORK DUE TO THE REQUIREMENT TO TAKE CARE OF A AMILY MEMBER SICK WITH COVID-19 WITHOUT SUFFICIENT INSURABLE HOURS – EFFECTIVE APRIL 2020
Eligible employees receive up to 15 weeks of benefits, up to $900 bi-weekly
Application via CRA
No medical

EMERGENCY CARE BENEFIT – UNABLE TO WORK DUE TO SCHOOL CLOSURE AND REQUIREMENT TO CARE FOR CHILDREN REGARDLESS OF INSURABLE HOURS
Eligible employees receive up to 15 weeks of benefits, up to $900 bi-weekly
Application via CRA

SMALL BUSINESS TEMPORARY WAGE SUBSIDY
Period of 3 months
10% of remuneration paid during 3 month period
Maximum subsidy of $1,375 per employee up to a maximum of $25,000 per employer
Subsidy immediately obtained through the reduction of remittances of income tax withheld

Staffing changes and your benefit plan – PLEASE READ

Clients and Friends,

I want to start by saying that we are here for you in these challenging times.  Thanks to another 12 days in self isolation (due to returning to Canada from a sailing trip) we will be in the office and available to you (now more than ever).

We are starting to get requests from clients about how they should handle benefits in the midst of laying off staff, reducing hours, having them work from home, and the other options you may be considering for the first time.  The short answer is that each insurer/ TPA is facing this for the first time too.  There is no standard answer.  Canada Life (was GWL) will be sending out the info below to advisors and clients very shortly.  This provides and aid to remember the various things we need to consider, but your provider may handle things quite differently. (CL/GWL is the first insurer to offer these options).

if you are laying off staff (with or without benefits) we need to ensure that it fits with the contract and that the insurer is notified.  if you are reducing hours, or rotating staff, then the minimum hours worked to be eligible for coverage may be affected, we need to let them know this too.

If you are in a critical position and need benefits suspended, or are considering the cancellation of your plan, it may make more sense to terminate coverage during the layoff, but maintaining coverage for a bare bones staff so that the coverage can be reinstated when staff are recalled.  Talk to us and we can work through possible solutions.


Canada Life (GWL) Communication

Canada Life (GWL) Renewals

To alleviate pressure on Canadian businesses during this time, effective immediately we will consider deferring, if requested by the plan sponsor, all non-finalized April, May and June renewals for 60 days each for all Selectpac and Regular, non-refund mid-market clients.  This will be done on a case by case basis.

Canada Life (GWL) Premium arrears handling

Effective immediately, we will stop sending letters or suspending claims at the 30-day mark and instead will move these activities to the 60-day mark. As with all other processes, this will be in effect for the next 2 months.

Canada Life (GWL) Reduction of work hours

Determining eligibility:

Minimum hours worked requirements for plan member eligibility under the contract will not be applied by the Enrolment, Life Claims and Disability teams from now until May 31.

If a plan sponsor would like to remove coverage for someone not meeting minimum hours, they need to submit a change request to have the employee terminated from the plan.

Canada Life (GWL) Covered benefit amounts:

Unless instructed otherwise by plan sponsors, benefits that are based on salary will be adjudicated based on the coverage for which the premium is being paid. Employer and employee premium rates will remain unchanged as we have committed to covering the higher benefit amounts.

Plans sponsors would need to request a salary reduction for employees working less hours if they do not want those employees to be covered for their standard life and LTD benefits.

This will only be temporary and is only an administrative handling practice so no formal changes to contracts will be made.

Canada Life (GWL) Temporary layoffs and leaves of absence

As you’re aware, our standard handling is to offer up to 31 days of coverage for short-term disability and long-term disability and up to 6 months for all other benefits.

Effective immediately, as a requested exception we will allow up to 60 days of short-term disability and long-term disability coverage and maintain the 6-month maximum for all other benefits.

As per usual process, even if a person satisfies their waiting period while on temporary layoff or leave of absence, disability benefits would not be payable until the employee’s declared return to work date as indicated by a recall letter from their employer.

Canada Life (GWL) Suspension of benefit plans

We will allow plans to suspend all coverage (premium and claims) for a maximum of 60 days with no penalty for reinstating. Plan Sponsors are accountable for communicating the impact of changes to coverage to their Plan Members.

Extremely important, if a disability was incurred during the time the plan was suspended, it will not be covered. Claims will only be covered if incurred while coverage was in force, or after the plan is reinstated. For the reason above, it’s recommended that life and long-term-disability remain in-force, while terminating less-essential benefits such as dental or vision. However, we are providing the full plan suspension offer for clients that really need it and enter into the agreement with full knowledge of the consequences.

Please note for Quebec, if long-term disability is offered on the plan, drugs cannot be terminated.

Canada Life (GWL) Out of Country Trip Limit increases

As per the most recent communication, “If you’re medically directed to quarantine by a physician or public health officials in advance of reaching your trip limitation and that results in surpassing the day limit, coverage would be temporarily extended to allow for potential coverage of a medical emergency until the end of the quarantine period upon which you could return home.”

We will consider, case-by-case, an exception up to 90 days for any individual circumstances that require exception handling based on compassionate grounds. An example of this may be someone who is unable to return home due to flight challenges.

Mainstay, Covid 19 and you!

I write this from a hotel room in St. Martin at the end of a great sailing holiday around what was once a beautiful island.  It’s not messed up by Covid-19 (there are NO cases here), but by hurricanes Irma and Maria almost 2 and a half years ago.  Some properties have recovered, others have sprung up from the rubble, but far too many are awaiting new zoning rules (French sides government delays) before they can begin the re-construction.  It’s amazing to see how far, and for how long the repercussions of events can last.

We are hoping to fly out on Tuesday (one of the last flights before the airport here is closed) and will then look at facing 2 weeks of self isolation (for being out of country).  As a result, our service levels may be a bit different.

If we have meetings scheduled with you, we’ll be in touch to reschedule, or to arrange to do them via Zoom.  Zoom is a great app that you can (but don’t need to) download to video conference, view files (like your renewal report etc) and meet virtually.  You can view and communicate all through a web browser and call in via phone if you don’t have a camera and microphone attached to your system.

I will also be postponing our Calgary and Vancouver industry educational events until the fall, as well as doing fewer speaking events over the next couple months.  As a result, I’m hoping to have more time to support our great clients, CGIB members, family and friends.

I hope that you, your families and staff are all okay during these challenging times.  I’ve already had friends step up and offer to get us groceries, friends of my son offer to get him from university and offer a place to stay so he doesn’t need to be alone (or locked up with us) and others offer to help.  We are truly lucky for having great people all around us..

This is a great time for everyone to help out friends, neighbours and absolute strangers and show how great humans can be.  Stay well.

Dave

GREAT NEWS – Dental Fee guide Increase LOWER than Expected.

Each year the Ontario Dental Association (ODA) sets their dental fee guide for the coming year.  This guide is used by many dentists to set their prices (though they can charge above or below this). Insurers tend to use these numbers as the “reasonable & customary” limitation for claims.

Last year the Ontario increase was 4.19% on average, which was the highest we’d seen in well over a decade.  The average over that time period was about 2.2%/ year.  The 1.27% increase for 2020 is a bit of a nice break and much lower than we’d been led to expect.

What this means to employers is that if your employees all submitted the exact same claims this year, as they did last year, then the cost charged would be 1.27% higher.  In reality, there are also trend and utilization numbers that are added to this (because we don’t do the same thing every year), but that said, this means a bit of relief in the rate creep we had been dreading.  (Other insurers will be similar to the levels shown below)